- 1. MARKETBEATINDUSTRIAL SNAPSHOTLAS VEGAS Q4 2011A Cushman
& Wakefield Research Publication ECONOMIC OVERVIEWon the volume
and timing of distressed industrial assetsAfter witnessing a very
flat year in Industrial introduced to the marketplace. We will be
watching and trackingmarket activity, we expect lower vacancythe
release of distressed product type for the next few years.rates
over the next few years. This marketimprovement is dependent on
continued jobgrowth and an improved economy. Overall,compared to
last year, vacancy is not rising and lease rates arenot falling as
fast or as far as we were witnessing. We are STATS ON THE
GOoptimistic that the 2012 economic outlook for the Las
Vegas4Q104Q11Y-O-Y 12 MONTH CHANGE FORECASTarea will show more
positive signs of growth and stability in theOverall Vacancy
15.8%15.1%-0.3ppmarket. Throughout 2011, vacancy and lease rates
haveremained stable and direct net absorption ended on a more
Direct Asking Rents$0.53 $0.52 -1.9%(psf/mo)positive note for the
first time since 2008.YTD Leasing Activity
6,621,1667,254,9889.6%VACANCY REMAINED STABLE (sf)The Las Vegas
Industrial market remained stable with vacancyrates at 15.1% during
fourth quarter 2011. The Centralsubmarket continues to show the
lowest vacancy rate at 8.6% OVERALL OCCUPIER ACTIVITYalong with the
Southeast submarket at 12.8% and Speedwaysubmarket at 10.9%. The
highest vacancy submarkets are theNorthwest at 28.2%, Airport at
19.3% and West submarket at msf18.1%. The high vacancy rates are
driven by weak tenantdemand and marginal stability, combined with
lease 3.1 9.4 5.73.4 9.1 4.9 7.3 4.5concessions, defaults and
downsizing.Direct net absorption, the measure of space leased from
one2008 2009 20102011 YTDreporting period to the next, for the
fourth quarter showed anLEASING ACTIVITY USER SALES
ACTIVITYimprovement from last quarter ending at (198,187). The
year-to-date total also showed an improvement from the past two
yearsat (836,111) sf. This is the first time since 2008 that direct
netabsorption has been out of the negative million marks. In 2009,
DIRECT RENTAL VS. VACANCY RATESthe year ended with a (5.8) million
sf and 2010 end with a$1.00negative (1.8) million
sf.18.0%$0.80PRICING 14.0% psf/yr$0.60The lease rates for the
industrial market have been very10.0%$0.40competitive over the last
three quarters of 2011. Landlords areeager to lease their buildings
and make deals on a short term $0.20 6.0%basis for cash flow
purposes. The median asking rental rates$0.00 2.0%have ranged
anywhere from $0.35/sf NNN to $0.52/sf NNN. 2007 2008 2009 2010
4Q11Tenants are looking to find bargains in terms of lease rates
DIRECT GROSS RENTAL RATEgoing back to 1998 prices. VACANCY
RATEOUTLOOKThe economic trends for Nevada are showing signs of
modestimprovement; not enough to reduce high unemployment butenough
to ease fears that another recession might be near.Many economists
expect similarly tepid growth in 2012 and2013. The economy would
need to grow consistently at 4% to5% to generate enough hiring to
significantly lowerunemployment. The Vacancy in 2012 may be
impacted based
2. MARKET HIGHLIGHTSSIGNIFICANT 2011 LEASE TRANSACTIONSSUBMARKET
TENANT/BUYER PROPERTY TYPESQUARE FEET4545 Cameron StreetWestNth
Degree Distribution 28,3963550 West Teco AvenueSouthwest Auto
Buyline Systems Inc Manufacturing28,4323030 North Lamb Blvd North
Las Vegas Pierce Distribution Services Distribution
31,306SIGNIFICANT 2011 SALE TRANSACTIONS SUBMARKET BUYERPURCHASE
PRICE SQUARE FEET3670 West Oquendo Road Southwest Mark
Five$2,100,000 50,0004450 North Walnut Road North Las Vegas WC
Property LLC$3,100,000 56,655985 Trade DriveNorth Las Vegas EP NLV,
LLC$7,490,000109,585* RENEWAL - NOT INCLUDED IN LEASING ACTIVITY
STATISTICSIndustrial Owner User Sales: User Sales (SF) and Average
Price Per Bldg (SF)700,000$300.00600,000$250.00500,000
$200.00400,000 $150.00300,000 $100.00200,000100,000$50.00-$0.007 8
8 88 99 990 00 01111 20 3040 1020 304011 2131 41112131414010 Q
QQQQQ QQ QQ QQQQ QQ QOwner user sales sfAverage Price Per Bldg sf
Industrial Investment Sales: Investment and Average Price Per
Bldg500,000$350.00450,000
$300.00400,000350,000$250.00300,000$200.00250,000200,000$150.00150,000$100.00100,000
$50.00 50,000-$0.007 8 8889 99 90 00 01111 20304010 2030 4011 2131
41112131414010 QQ QQ QQ QQ QQ QQQQ QQ Q Investment sales sf Average
Price Per Bldg sf The market terms and definitions in this report
are based on NAIOP standards. NoCommerce Real Estate Solutions
warranty or representation, express or implied, is made to the
accuracy or3980 Howard Hughes Pkwy Suite 100completeness of the
information contained herein, and same is submitted subject to
errors, omissions, change of price, rental or other conditions,
withdrawal without notice,Las Vegas, NV 89169and to any special
listing conditions imposed by our principals. 2011 Cushman
&www.cushmanwakefield.com/knowledge Wakefield, Inc. All rights
reserved. 3. Inventory VacancyDemand &No. of Existing Vacancy
NetGross Space Asking Rates * SubleaseBldgs.SF
SFRateAbsorptionLeased Median SFDistribution 1125,721,992
749,13013.09%16,05176,894$0.46 0Flex701,849,622 497,22526.88%
(13,012) 6,826 $0.56 21,796Light Industrial1254,08418,546 34.29%
(3,784)0 $0.55 0Incubator 781,760,192 517,16829.38% (8,871)2,089
$0.65 0Midbay 1623,498,691 709,95420.29%36,20951,019$0.55 0Airport
Total434 12,884,5812,492,023 19.34%26,593 136,828$0.55
21,796Distribution 1093,827,287 207,580 5.42% (12,240) 11,760$0.35
0Flex11 145,85922,855 15.67%0 0 $0.43 0Light Industrial
314,6084,84833.19%0 0 $0.49 0Incubator1022,059,307
207,39110.07%973973$0.46 0Midbay 2312,420,496 282,78411.68%
(30,220) 0 $0.40 0Central Total4568,467,557 725,458
8.57%(41,487)12,733 $0.430Distribution 1118,156,665
938,55711.51%26,97131,471$0.39151,101Flex29 476,29434,7257.29%
3,3605,328 $0.59 0Light Industrial1367,7617,77411.47% (3,049)0
$0.45 0Incubator 51 854,92680,2829.39% (3,904)0 $0.59 0Midbay
2082,889,058 530,83218.37% (11,368) 38,479$0.45 4,667Southeast
Total412 12,444,7041,592,170
12.79%12,01075,278$0.45155,768Distribution 242 20,843,983
2,934,64014.08%(100,438) 51,767$0.32 0Flex33 775,957126,96416.36%
1,6101,610 $0.50 8,000Light Industrial68 325,37924,9317.66%0 0
$0.42 0Incubator 781,241,254 466,93737.62%0 0 $0.47 0Midbay
3464,794,854 744,52515.53% (37,456) 57,308$0.35 0NLV Total767
27,981,4274,297,997 15.36% (136,284) 110,685 $0.428,000Distribution
9 889,09134,9993.94%15,18021,012$0.25 0Flex 7 346,35019,4175.61%
5,0665,066 $0.28 0Light Industrial 0 0 -0.00%0 0 0Incubator226,887
-0.00%0 0 0Midbay201,314,491 227,42617.30% 2,04510,105$0.40
0Speedway Total382,576,819 281,84210.94%22,29136,183$0.28
0Distribution 7 463,834135,16929.14%14,83614,836$0.68 0Flex24
400,270107,28126.80% 2,1593,223 $0.60 0Light Industrial 0 0 -0.00%0
0 0Incubator 10 261,57392,591 35.40%0 0 $0.43 0Midbay 4
154,48326,161 16.93% (11,680) 0 $0.63 0Northwest Total 451,280,160
361,20228.22% 5,31518,059$0.62 0Distribution 130 11,732,022
1,331,41611.35%(156,728) 15,350$0.50442,582Flex 1072,855,252
538,37818.86% (31,576) 38,511$0.60 2,000Light Industrial40
297,21257,616 19.39% (4,000)0 $0.55 0Incubator1242,496,396
373,44714.96% (7,615)39,885$0.65 0Midbay 4727,924,519
1,282,37616.18% 138,529 207,711$0.50 25,506Southwest Total873
25,305,4013,583,233 14.16%(61,390) 301,457 $0.55
470,088Distribution753,135,024 643,49020.53% (11,209) 3,639 $0.55
0Flex421,196,302 211,67617.69% (9,788)0 $0.65 0Light Industrial11
121,42316,065 13.23%701 1,200 $0.55 0Incubator1463,731,077
640,36917.16% 8,12943,800$0.63 5,857Midbay 2423,490,157
595,66617.07% (13,068) 28,757$0.55 0West Total 516
11,673,9832,107,266 18.05%(25,235)77,396$0.55 5,857Distribution 795
54,769,898 6,974,98112.74%(207,577)226,729$0.43593,683Flex
3238,045,906 1,558,52119.37% (42,181) 60,564$0.58 31,796Light
Industrial 147 880,467129,78014.74% (10,132) 1,200 $0.52
0Incubator591 12,431,612 2,378,18519.13% (11,288) 86,747$0.59
5,857Midbay1,68526,486,749 4,399,72416.61%72,991 393,379$0.48
30,173Las Vegas Total 3,541 102,614,63215,441,19115.05% (198,187)
768,619 $0.52 661,509Asking median Lease rates is the median of all
lease rates that are asking, published prices.Note: Due to
reclassifications of, and adjustments to, data between reporting
periods, the commercial market data for the latest quarter may not
necessarily be comparable to a previouslyreported quarter.The
market terms and definitions in this report are based on NAIOP
standards. NoCommerce Real Estate Solutionswarranty or
representation, express or implied, is made to the accuracy or3980
Howard Hughes Pkwy Suite 100 completeness of the information
contained herein, and same is submitted subject toerrors,
omissions, change of price, rental or other conditions, withdrawal
without notice,Las Vegas, NV 89169 and to any special listing
conditions imposed by our principals. 2011 Cushman
&www.cushmanwakefield.com/knowledgeWakefield, Inc. All rights
reserved. 4. Total YTD Gross Space LeasedTotal YTD Net
Absorption1Q2Q3Q4Q Total1Q2Q3Q4QTotalGross Space Gross Space Gross
Space Gross Space Gross Space Net Net Net
NetNetLeasedLeasedLeasedLeasedLeased AbsorptionAbsorption
Absorption Absorption Absorption Distribution 206,230 214,953
33,64476,894 531,721 (20,372) 103,080(64,893) 16,05133,866 Flex
96,21912,66996,807 6,826 212,52148,360 (104,225) 75,591
(13,012)6,714 Light Industrial 00 00 0(11,150)0
(3,612)(3,784)(18,546) Incubator14,50467,99315,874 2,089
100,460(214,434)46,264 2,519 (8,871) (174,522) Midbay 119,326
107,822111,18851,019 389,355 (85,549)45,79440,382 36,20936,836
Airport Total436,279 403,437257,513 136,8281,234,057
(283,145)90,91349,987 26,593(115,652) Distribution 96,24751,576
3,72311,760 163,30673,494 23,396(46,001) (12,240)38,649 Flex6,400 0
006,400 6,400 0 (6,255) 0 145 Light Industrial 00 00 0 00000
Incubator30,09021,84857,803973110,714 (43,169) (45,526) 49,633
973(38,089) Midbay 44,47922,43848,0100114,927
(54,919)22,438(34,056) (30,220) (96,757) Central Total177,216
95,862 109,53612,733 395,347 (18,194) 308(36,679)(41,487)(96,052)
Distribution 187,878 50,679 265,73031,471 535,758
(40,131)18,91071426,9716,464 Flex 23,8105220 5,32829,66023,810
(2,516) (3,764) 3,36020,890 Light Industrial480 0
4,16204,64248004,162 (3,049) 1,593 Incubator42,93536,802 7,1800
86,91734,525 19,806 7,180 (3,904) 57,607 Midbay 128,610 55,995
168,91638,479 392,000 (28,683) (58,336) 94,953 (11,368) (3,434)
Southeast Total383,713 143,998445,98875,2781,048,977 (9,999)
(22,136) 103,24512,01083,120 Distribution 554,653
564,945165,74851,7671,337,113 (435,657) 501,445
(283,102)(100,438)(317,752) Flex 15,86913,32813,195 1,61044,002
1,183 1,238 (7,110) 1,610 (3,079) Light Industrial 13,719 3,678 00
17,397 9,219 3,678 (7,804) 05,093 Incubator73,47966,917
2,0000142,39618,031 50,608(8,746) 059,893 Midbay 266,385 124,451
18,80057,308 466,944129,92688,685(76,442) (37,456) 104,713 NLV
Total924,105 773,319199,743 110,6852,007,852 (277,298) 645,654
(383,204)(136,284)(151,132) Distribution 0 27,50452,12621,012
100,642 (29,167)27,50452,126 15,18065,643 Flex 13,571 2,533 5,066
5,06626,236 9,788 (3,000)05,06611,854 Light Industrial 00 00 0
00000 Incubator 2,533 0 3,74306,276 2,533 03,74306,276 Midbay 0
20,35848,13210,10578,595 (91,644)(6,870) 31,8682,045 (64,601)
Speedway Total 16,10450,395 109,06736,183
211,749(108,490)17,63487,737 22,29119,172 Distribution 00
014,83614,83600 (6,360)14,8368,476 Flex 11,41232,36439,557
3,22386,556 (12,657)22,81924,7552,15937,076 Light Industrial 00 00
0 00000 Incubator 1,298 9,863 00 11,161 (702)(25,870) (50,000)0
(76,572) Midbay 01,702 001,70201,702 (8,081)(11,680) (18,059)
Northwest Total12,71043,92939,55718,059 114,255 (13,359)
(1,349)(39,686)5,315 (49,079) Distribution 41,784160,298
23,87515,350 241,307(160,583)(186,712)(266,428)(156,728)(770,451)
Flex 128,551 102,276 32,39038,511 301,72827,740 70,951 3,589
(31,576)70,704 Light Industrial6,505 0 006,505 2,905 00
(4,000)(1,095) Incubator64,38966,06619,31439,885 189,654
(23,870)32,484(50,781) (7,615)(49,782) Midbay 283,859
161,003104,974 207,711 757,54795,259 58,165(11,793) 138,529280,160
Southwest Total525,088 489,643180,553 301,4571,496,741(58,549)
(25,112)(325,413)(61,390) (470,464) Distribution 43,73344,73228,436
3,639 120,54014,733 43,41822,731 (11,209)69,673 Flex 18,32826,177
6,8200 51,325 (25,540)(7,749) (9,832)(9,788)(52,909) Light
Industrial 14,871 0 7,200 1,20023,27114,871 (4,000)3,105 701 14,677
Incubator150,901 52,91332,96143,800 280,575 6,222(34,268)
(64,744)8,129 (84,661) Midbay 90,03380,06871,44128,757 270,299
(77,363)57,01815,228 (13,068) (18,185) West Total 317,866
203,890146,85877,396 746,010 (67,077)54,419(33,512)(25,235)(71,405)
Distribution1,130,525 1,114,687 573,282 226,7293,045,223 (597,683)
531,041 (591,213)(207,577)(865,432) Flex 314,160
189,869193,83560,564 758,42879,084(22,482) 73,974 (42,181)91,395
Light Industrial 35,575 3,67811,362 1,20051,81516,325 (322)
(4,149)(10,132)1,722 Incubator380,129 322,402138,87586,747
928,153(220,864)43,498 (111,196) (11,288)(299,850) Midbay 932,692
573,837571,461 393,3792,471,369 (112,973) 208,59652,059 72,991
220,673 Las Vegas Total 2,793,081
2,204,4731,488,815768,6197,254,988 (836,111) 760,331
(580,525)(198,187)(851,492)The market terms and definitions in this
report are based on NAIOP standards. NoCommerce Real Estate
Solutionswarranty or representation, express or implied, is made to
the accuracy or3980 Howard Hughes Pkwy Suite 100 completeness of
the information contained herein, and same is submitted subject
toerrors, omissions, change of price, rental or other conditions,
withdrawal without notice,Las Vegas, NV 89169 and to any special
listing conditions imposed by our principals. 2011 Cushman
&www.cushmanwakefield.com/knowledgeWakefield, Inc. All rights
reserved. 5. Leasing Activity vs Absorption6,000,00010,000,000
9,000,0004,000,000 8,000,0002,000,0007,000,000Gross Space Leased
6,000,000Absorption-2005 2006200720082009 20102011 YTD
5,000,000(2,000,000) 4,000,000(4,000,000)3,000,000
2,000,000(6,000,000) 1,000,000(8,000,000)0 AbsorptionGross Space
LeasedIndustrial: Inventory Vacancy Rate vs Average Lease
Rate18.00% $0.9017.00%16.00% $0.8015.00%14.00% $0.7013.00%
$0.6012.00%11.00% $0.5010.00% 9.00% $0.40 8.00% 7.00% $0.30 6.00%
5.00% $0.20 4.00% 3.00% $0.10 2.00% 1.00% $0.00 78 88 8999 9 0 0
001 1 1 2030 40102030 40 11 21 314121 31 41 40 10QQ QQQQ Q Q QQQQ Q
QQ Q Vacancy RateLease RateThe market terms and definitions in this
report are based on NAIOP standards. NoCommerce Real Estate
Solutionswarranty or representation, express or implied, is made to
the accuracy or3980 Howard Hughes Pkwy Suite 100 completeness of
the information contained herein, and same is submitted subject
toerrors, omissions, change of price, rental or other conditions,
withdrawal without notice,Las Vegas, NV 89169 and to any special
listing conditions imposed by our principals. 2011 Cushman
&www.cushmanwakefield.com/knowledgeWakefield, Inc. All rights
reserved. 6. Las Vegas Industrial Overview 2003-2011
9,000,00015.37% 7,000,000 14.03% 16.00% 5,000,00015.05% 3,000,000
Square Feet Vacancy 1,000,0008.90% 11.00%11.11% -1,000,0007.03%
-3,000,000 4.84%6.00% -5,000,000 4.95% -7,000,000 3.43% -9,000,000
1.00% 20,956 656747 33 64 5132 4,2 18,6 2,4 3, 91, 43, 7 6,14, 6
,96,00 ,15 ,20 , 57 2,42 , 90 ,68 ,617378 8187 89 1010 0 10 11 02
$0.52 $0.56$0.67 $0.75 $0.79$0.78$0.64 $0.53 $0.52 200320042005
20062007 200820092010 2011PlannedUnder Construction Total Space
CompletedNet Absorption Vacancy Rate The market terms and
definitions in this report are based on NAIOP standards. NoCommerce
Real Estate Solutions warranty or representation, express or
implied, is made to the accuracy or3980 Howard Hughes Pkwy Suite
100completeness of the information contained herein, and same is
submitted subject to errors, omissions, change of price, rental or
other conditions, withdrawal without notice,Las Vegas, NV 89169and
to any special listing conditions imposed by our principals. 2011
Cushman &www.cushmanwakefield.com/knowledge Wakefield, Inc. All
rights reserved.
